The reporting of the financial results of an organisation is the responsibility of the management of that organisation. However, value may be added to the financial statements by the auditing of such financial statements and by the opinion expressed by the external auditors. Furthermore, there is the expectation on the part of the users of the financial statements that the auditors are also responsible for detecting fraud and, more specifically, financial statement fraud. It was stated in the Association of Certified Fraud Examiners 2010 Report to the Nations that it is the high-level perpetrators who cause the greatest damage to their organisations. The costs arising from financial statement fraud were found to be more than three times higher than the costs arising from fraud committed by lower-level managers and nine times more than the costs involved in employee fraud. The question, thus, arises as to why the auditors would not detect financial statement fraud timeously. The external audit profession has formulated a specific standard which addresses the responsibility of the external auditor as regards the detection of fraud during the audit of financial statements. The aim of this research was to determine the adequacy of the internal auditor standards as regards providing guidance to the internal auditors in terms of detecting financial statement fraud. This research highlighted the lack of guidance in the internal audit standards regarding the responsibility of internal auditors relating to financial statement fraud. In the main, both the directives and the guidance refer to fraud in general but not specifically to financial statement fraud and, thus, the professional internal auditor is forced to seek guidance outside of the internal audit standards as regards the detection of financial statement fraud. / MPhil University of Pretoria, 2014 / Auditing / MPhil / Unrestricted

M.Com. (Computer Auditing) / The implementation of EDI into South Africa business has only started in the recent past. The main reason for this is the fact that the huge benefits in terms of faster processing of business transactions, reduced costs of processing and the formation of strategic business alliances with key business partners, is only now being accepted by management. The other reason is due to the fact that large, commercially operated Value Added Networks (VANs) have only been in existence in this country during the last two years. The primary objective of this short dissertation can be summarised as follows: a) To provide a brief overview of the developments which are currently taking place in South Africa in the Electronic Data Interchange (EDI) environment and the Value Added Network (VAN) environment; b) To highlight how EDI is currently being implemented in South Africa; c) To develop a simplistic framework of key information systems controls which an auditor should consider when evaluating the information systems at a client; and d) To apply this controls framework to the EDI and VAN environments in order to derive lists of the information systems controls which should be reviewed by the auditor when their client makes use of an EDI VAN.

M.Comm. (Computer Auditing) / Please refer to full text to view abstract

M.Com. / In recent years large organisations that developed mainframe application software in-house are now purchasing software packages to replace these applications. These advanced packages incorporate a high level of integration and include security and control features to ensure that the integrity of input, processing, output and storage are maintained. Computer auditors are required to evaluate these advanced packaged software to ensure that the security and control features are adequate and comply with organisational standards. Furthermore, they must ensure that the integrity of information systems programs and data are maintained ...

The aim of this study is to develop and propose a strategic role enhancement for the Internal Auditing function for South African companies, by incorporating the Balanced Scorecard as a guide. The proposed strategy will be developed based on the methodology and the relevant elements and aspects for such a strategy derived from the latest literature on the subject. The concepts of Internal Auditing, strategy and Balanced Scorecard will be defined and discussed, by means of literature research. The intent of this paper is to consider the critical aspects regarding the utilisation of the Balanced Scorecard to enhance the strategic role of the Internal Auditor. / Mr. J. Bredenkamp

The deregulating electricity industry is a capital intensive and political sensitive industry (Pretorius, 1998:3). All the deregulation and privatisation incentives are, and continue to be hotly discussed topics by various stakeholders across the world. At the same time, the auditing profession has been the subject of scrutiny specifically after several corporate failures that noticeably include Enron Corporation, one of the world’s largest companies that operated in the deregulated electricity industry in the United States of America (hereafter referred to as the USA). As a result, the auditing profession has been reviewing many audit procedures and core aspects of the profession that has remained contentious issues over a number of years. This study is focussed at the definition and application of engagement risk within the auditing profession and aims to identify those factors present in the current deregulating electricity industry in South Africa that should be considered in the evaluation of engagement risk by the independent auditor. An error in the evaluation of engagement risk of a client can be, and is most likely to be a costly error. Settlement of legal claims may be very costly both in monetary terms and in damage to a firm’s reputation (Odendaal, 2002). Although most claims are successfully defended, the cost of defence is typically very high, including legal costs and the time of senior professionals. Odendaal (2002) refers to “the international liability crisis” as a rise in legal litigation and competition amongst auditing firms have lead auditors to progressively place greater reliance on the client acceptance stage as the first step in their risk control programme. This study continues to focus on engagement risk, specifically within the deregulating electricity industry in South Africa, an industry that is undergoing rapid change. The South African electricity supply industry is currently in the midst of a transition from a vertically integrated and regulated monopoly to an entity that will operated in a competitive market where retail customers will choose the suppliers of their electricity (South Africa, 2000). The old school of thought that considered electric utility power generation, transmission, and distribution a “natural monopoly” has given way to a new school of thought. There is a widespread view among legislators, regulators, industry analysts, and economists that the Electricity Supply Industry (hereafter referred to as the ESI) and Electricity Distribution Industry (hereafter referred to as the EDI) would be more efficient and economical in a competitive market (Energy Information Administration, 2000). The objective is the consolidation of the EDI into Regional Electricity Distributors (hereafter referred to as REDs), created from the distribution assets and operations owned by municipal local governments (Municipalities) and Eskom (Yelland, 2002). From a generation perspective, Eskom is expected to run out of excess generating power in 2006 (Eskom, 2003:57). This means that independent power producers (hereafter referred to as IPPs) are likely to be licensed in the next two years in order to meet South Africa's future electricity requirements. Eskom’s Transmission Group is likely to be the Independent System Operator (hereafter referred to as ISO), a not for profit state owned entity which effectively would manage the Southern African energy market, buying from Eskom and other electricity generators and selling to REDs and neighbouring countries at prices determined by a market pricing mechanism (NER, 2001). As a competitive market for electricity trading has not yet been established in southern Africa, a number of foreign electricity markets have been studied by entities such as the National Energy Regulator (hereafter referred to as the NER) in order to research best practice in formulating a draft energy-trading model for South Africa (NER, 2001). Accordingly this study also focuses on providing the auditor with and understanding of the current and future structure of the electricity industry as well as the regulatory framework and suggested developments. / Mr. A. van der Watt

M.Com. (Computer Auditing) / Both the auditor, faced with the task of determining an effective and efficient audit approach, as well as management, charged with implementing and monitoring need purer security, need to evaluate integrity controls. This need to evaluate integrity controls is increasing, due to the growing complexity of computer environments, the breakdown of the paper audit trail, and the replacement of application controls by integrity controls. By applying the Access Path and Path Context Models, an evaluation was performed of integrity controls and risks in an AS/400 environment. The operating system (08/400) was delineated into functional categories to assist in the evaluation, in a manner consistent with that outlined in the Access Path Model. It was found that sufficient integrity control facilities exist in an AS/400 environment to meet the control objectives, although several risks were identified which could only be addressed by application controls.

M.Comm. / Please refer to full text to view abstract

M.Eng. (Engineering Management) / The residential and commercial urban sprawl towards green future is governed by the ability to overcome the challenges facing the high rise buildings sustainability. This research is dedicated to assess the high rise buildings’ energy towards near net-zero energy consumption from the point of view of production (the on-site energy generation via renewable technologies) and consumption (the usage of low consumption products). The features of the high rise buildings limit the on-site renewable energy production to solar energy, therefore the integration of solar application in the building’s facade plays a major role in the on-site energy production. Since, the relative roof area compared to the height of the high rise buildings is much less than the single family houses. Therefore, the use of the facade in high rise buildings for clean energy production becomes a major element towards its sustainability. There are several solar energy production techniques of which the most feasible and effective one is the combined electricity generation and heat collection via integrating PV and thermal collector system this system is denoted as solar Photovoltaic and Thermal (PVT) system. PVT system produces both electricity and heat at a higher efficiency from one integrated system on the same surface area exposed to the sun. For instance, PVT system produces approximately 43% more primary energy than a conventional solar thermal collector per unit surface area, and even around 96% more than a conventional Photovoltaic PV system (PVTwins, n.d). The concept of the PVT system was generated based on the fact that Photovoltaic (PV) system has typically 14-17% efficiency, so the rest of more than 80% is a lost energy; this lost energy goes in a form of heat. This heat could reach as high as 50oC above the ambient temperature resulting in structural damage as well as reducing the system efficiency by 25%. Recovering this harmful heat could reach up to five times thermal energy more than electricity from PV array (Hollick, 2011). From the energy consumption perspective, the air conditioning and ventilation system (HVAC) is considered as one of the highest energy consumer in the overall high rise buildings energy consumption (around 40%). This makes it an essential part of any high rise buildings energy solution therefore several low energy consumption HVAC systems has been developed recently. As such, absorption chiller presents one of the greenest HVAC system whereby it has no moving part, no electricity required, thermal driven system (use heat to produce cold) and could be operated by solar thermal energy. In this sense, the enterprise should respond to the increasing demand of the high efficiency buildings mainly by developing new solutions that enhance the latest green technologies and overcome the recent energy challenges.

M.Comm. / Towards addressing the detrimental economic effects past dispensations had on the marginalized majority, different Government initiatives and other interventions have been put in place to encourage the participation of Blacks in the economy of South Africa. These development initiatives seek to address poverty and unemployment levels, some focussing on growing small, medium, and micro enterprises (SMMEs). Growth and sustainability of such businesses can only be achieved through the maintenance of appropriate financial information, on which economic decisions are based, but such information can only be generated or processed if relevant and adequate accounting data, through accounting recordkeeping, are maintained. The study examines whether this is also applicable to micro or survivalist businesses, and was carried out to investigate the accounting records maintained by small Black-owned businesses in QwaQwa. In the literature study it became vital to elucidate the uniqueness of micro and survivalist businesses as they are often generalised under the rather broad umbrella of the term ‘SMMEs’. The literature further indicates that there is no prescribed regulation or framework specifically for accounting recordkeeping in micro and survivalist businesses. The dissertation analyses responses to questionnaires administered to a purposively selected sample of 88 small Black-owned businesses in QwaQwa, and interpreting 44 respondents interviewed. The interviews became necessary due to insufficient responses to the section in the questionnaires addressing the third research objective. Hence, both a quantitative and a qualitative research design were eventually used. Data collection took place at respondents’ business premises. Responses to the questionnaires were analysed using Statistical Package for the Social Sciences (SPSS), which was used to generate descriptive statistics. The researcher documented the interview proceedings in written format. Common responses from interviews were clustered in themes then interpreted. Results show that small Black-business owners maintain some basic form of accounting records such as sales records, payment records and stock records, however, since they operate mainly on the cash basis, debtors’ and creditors’ records were seldom maintained. These findings are consistent with previous studies into the kind of accounting records maintained by small businesses. Small Black-business owners also perceived maintaining accounting records to be important in determining the profitability and future sustainability of their businesses. These owners, however, demonstrated limited understanding of accounting concepts and principles or how these applied to their business. They identified a need for some form of interventions to improve their knowledge of accounting recordkeeping and risk management. A further need identified was the availability of funds to finance their businesses. Therefore, financial help together with training and development are needed to better their businesses. This may go a long way in improving growth and stability, as well as reducing the poverty and unemployment rate in the country. In order for micro and survivalist business owners to realise some of the benefits of maintaining relevant accounting records, it is recommended that the owners are trained on how to keep basic accounting records that are useful and easy to convert into accounting information, and that may add value to their businesses and ensure the monitoring of profitability and sustainable growth.